New Antitrust Illegality Per Se: Forestalling and Patent Misuse, The
![handle is hein.journals/clr50 and id is 228 raw text is: THE NEW ANTITRUST ILLEGALITY PER SE: FORESTALLING
AND PATENT MISUSE
GEORGE H. SCHUELLER*
I. INTRODUCTION
The traditional interpretation of American antitrust laws abounds with
historical references to related common law doctrines and concepts.' The
very phrase restraint of trade as used in the Sherman Act,2 for instance, is
generally understood in its common law meaning.3 The Standard Oil Com-
pany of New Jersey4 and the American Tobacco5 decisions held that the
trade abuses at which the Sherman Act aims are in substance equivalent to
those which the common law condemned; the Rule of Reason as enunciated
in these twin opinions set forth the theory that the Act prohibits restraints of
trade only if they are unreasonable in the light of the common law.6 Prior
to these two decisions, the Rule of Reason had been deemed applicable only
to voluntary restraints,7 such as a covenant not to carry on one's trade, and
then only if such covenant was ancillary to some legitimate principal trans-
action.
Under the influence of nineteenth century English decisions which re-
flected the principles of laissez faire,9 the Standard Oil and American To-
bacco opinions broadened the scope of reasonableness and expanded the ap-
* The views expressed in this article are those of the author and not necessarily
those of the Department of Justice.
1. See, e.g., Mr. Justice White dissenting in United States v. Trans-Missouri Freight
Association, 166 U.S. 290, 343 (1897) ; United States v. Addyston Pipe & Steel Co., 85
Fed. 271 (6th Cir. 1898), aff'd, 175 U.S. 211 (1899) ; Standard Oil Company of N. J. v.
United States, 221 U.S. 1 (1911). Apex Hosiery Co. v. Leader, 310 U.S. 469, 498 (1940).
2. 26 STAT. 209 (1890), 15 U.S.C. §§ 1, 2 (1946) : Sec. 1 Every contract, com-
bination in the form of trust or otherwise, or conspiracy, in restraint of trade or com-
merce among the several States, or with foreign nations, is hereby declared to be il-
legal. .. . Sec. 2 Every person who shall monopolize, or attempt to monopolize, or
combine or conspire with any other person or persons, to monopolize any part of the
trade or commerce among the several States, or with foreign nations, shall be deemed
guilty of a misdemeanor. . .
3. This Court has since repeatedly recognized that the restrictions at which the
Sherman law is aimed . . . are only those which are comparable to restraints deemed
illegal at common law ...... Apex Hosiery Co. v. Leader, 310 U.S. 469, 498 (1940).
4. Standard Oil Company of N. J. v. United States, 221 U.S. 1 (1911).
5. United States v. American Tobacco Co., 221 U.S. 106 (1911).
6. For a brief outline of the development of the Rule of Reason, see HANDLER, A
STUDY OF THE CONSTRUCTION AND ENFORCEMENT OF THE FEDERAL ANTI-TRUsT LAWS 3
(TNEC Monograph 38, 1941).
7. Concerning voluntary and involuntary restraints, see United States v. Patten,
226 U.S. 525, 541 (1913), reversing, 187 Fed. 664 (1911); Comment, 34 ILL. L. REv.
956, 962 n.33 (1940). See also note 8 infra.
8. See United States v. Addyston Pipe and Steel Co., 85 Fed. 271, 280, 282, 283 (6th
Cir. 1898), aff'd, 175 U.S. 211 (1899) ; Big Sandy & Cincinnati, P. B. S. & P. Packet Co.
v. Bay, 200 U.S. 179 (1906); RESTATEmENT, CONTRACTS §§515(e), 516(f) (1932). Cf.
Rogers v. Parry, Cro. Jac. 326, 79 Eng. Rep. 278 (K.B. 1613). The Rule of Reason was
first applied to voluntary restraints in Mitchel v. Reynolds, 1 P. Wins. 181, 24 Eng. Rep.
347 (Ch. 1711).
9. E.g., Nordenfelt v. The Maxim Nordenfelt Guns and Ammunition Co., [1894]
A. C. 535; Mogul Steamship Co. v. McGregor, Gow & Co. [1892] A. C. 25.](ViewImageLocal?handle=hein.journals/clr50&div=23&collection=journals&method=preview&ext=.png&size=3)
What Is HeinOnline?
Contact us for annual subscription options:
Already a HeinOnline Subscriber?
profiles profiles most
New Antitrust Illegality Per Se: Forestalling and Patent Misuse, The
Contact us for annual subscription options:
Already a HeinOnline Subscriber?
profiles profiles most